UK April Inflation Rate Below Forecasts at 2.1%


The annual inflation rate in the United Kingdom increased to 2.1 percent in April 2019 from 1.9 percent in the previous month but below market expectations of 2.2 percent. It was the highest inflation rate in four months, mainly boosted by a rise in energy bills as Britain's energy regulator increased a price cap on energy providers by 10 percent.

Year-on-year, prices went up further for housing, water, electricity, gas and other fuels (3.4 percent compared to 1.2 percent in March); transport (4.7 percent compared to 3.3 percent); miscellaneous goods and services (0.9 percent compared to 0.6 percent); and communication (4.6 percent compared to 3.7 percent). Meanwhile, cost eased for food and non-alcoholic beverages (0.7 percent compared to 0.8 percent); restaurants and hotels (2.4 percent compared to 2.8 percent); household equipment and maintenance (0.2 percent compared to 0.6 percent); recreation and culture (1.5 percent compared to 2.7 percent); health (2.3 percent compared to 2.5 percent); and alcoholic beverages and tobacco (3.9 percent compared to 5.2 percent). Additionally, cost of clothing and footwear fell at a faster pace (-1.9 percent compared to -1.6 percent) and inflation was steady for education (at 3.1 percent, the same as in March). 

The consumer prices index including owner occupiers’ housing costs (CPIH) rose to 2.0 percent in April from 1.8 percent in March.

The annual core inflation rate, which excludes prices of energy, food, alcohol and tobacco, advanced by 1.8 percent, the same as in March and slightly below market forecasts of 1.9 percent.

On a monthly basis, consumer prices rose 0.6 percent, after a 0.2 percent gain in the prior month but lower than market consensus of 0.7 percent. Prices advanced further for housing, water, electricity, gas and other fuels (2.5 percent compared to 0.1 percent); health (0.8 percent compared to 0.3 percent); communications (1.3 percent compared to 0.2 percent); and miscellaneous goods and services (0.4 percent compared to 0.2 percent). Also, cost of transport rebounded (2.4 percent compared to -0.1 percent). On the other hand, prices declined for food and non-alcoholic beverages (-0.3 percent compared to 0.1 percent in March); furniture and household equipment (-1.2 percent compared to 0.1 percent); and recreation and culture (-0.8 percent compared to 0.2 percent).

UK April Inflation Rate Below Forecasts at 2.1%


ONS | Stefanie Moya | stefanie.moya@tradingeconomics.com
5/22/2019 8:56:59 AM